The board of Japanese automaker Mitsubishi Motors, which is allied with Renault and Nissan, voted Monday to dismiss Carlos Ghosn as its chairman after his arrest last week, citing a lack of trust.
Prosecutors arrested Ghosn on Nov. 19 on suspicion of under-reporting his income by $44 million over five years. Nissan Motor Co. ousted him as its chairman last week, saying an internal investigation found Ghosn abused company money and assets.
Mitsubishi said its current CEO, Osamu Masuko, will serve as both acting chairman and CEO pending a general shareholders meeting. It said Ghosn had lost the trust of Nissan and would find it difficult to continue to act as chairman.
Masuko told reporters the board’s decision was unanimous.
Seven of Mitsubishi Motors Corp.’s eight-member board attended Monday’s meeting, the company said.
Ghosn’s arrest in Tokyo marks a stunning fall for an executive who dominated the Japanese auto industry for two decades and spearheaded Nissan’s alliance with Renault SA of France.
Ghosn also led the addition of Mitsubishi into the alliance. Nissan took a 34 percent stake in Mitsubishi in 2016 after the smaller automaker was embroiled in an inspections reporting scandal.
Japanese media, citing unidentified sources, have reported that Ghosn and Greg Kelly, an executive who was arrested on suspicion of collaborating with Ghosn, are asserting their innocence. Ghosn has not commented publicly.
The two executives have not yet been charged. Under Japanese law, a suspect can be held in custody for up to three weeks per suspected charge without any charges being filed.
Renault has kept Ghosn as chief executive. But considering the makeup of Mitsubishi’s board little opposition to his dismissal is expected.
The board consists of Ghosn, Mitsubishi Motors Chief Executive Osamu Masuko, two people from Nissan, two from the Mitsubishi group companies and two outsiders - a writer and an academic.
Worries are growing about the future of the alliance between Renault and Nissan. The future of the alliance with Mitsubishi, being more recent, could be even more precarious.
Alliances often benefit automakers because they share technology, auto parts, and supplier and sales networks. Sales volume tends to lower costs.
Analysts say such sharing has been growing in importance as companies develop electric vehicles, net connectivity and artificial intelligence for autos.